How can Microstrategy buy so many BTC, while other funds waiting for ETF?

Saint-loup

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Quote from: a298b112 on December 01, 2023, 10:45:21 AM

Well, after recent news about MicroStrategy's purchases of BTC, I wonder how come Saylor and his company can buy so many BTC, while other companies/funds are (kind of) waiting for ETFs to be approved?

And another question is, MicroStrategy seems to be not that big company, comparing Apple, MS and Google. Where they get money to buy BTCs? I mean are they getting loan, or doing some kind of fundraising?

Yes I heard they bought 16,130 bitcoins for $593.3 million in cash during November.
I guess they are certainly applying the famous proverb "Buy the rumors, sell the news" so it could be a rather common and safe strategy for investing into BTC for the time being. BTC is very likely to rise further before the ETF spot approval by the SEC, and then falling down again afterward. So I hope they are ready to sell some of their bag, if they want to make some cash money or just being able to buy more of it.

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“On November 30, 2023, MicroStrategy announced that, during the period between November 1, 2023 and November 29, 2023, MicroStrategy, together with its subsidiaries, acquired approximately 16,130 bitcoins for approximately $593.3 million in cash, at an average price of approximately $36,785 per bitcoin, inclusive of fees and expenses,” MicroStrategy stated. “As of November 29, 2023, MicroStrategy, together with its subsidiaries, held an aggregate of approximately 174,530 bitcoins, which were acquired at an aggregate purchase price of approximately $5.280 billion and an average purchase price of approximately $30,252 per bitcoin, inclusive of fees and expenses.”

https://www.nasdaq.com/articles/microstrategy-buys-an-additional-16130-bitcoin-for-$593-million

Kelward

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Quote from: Amphenomenon on December 01, 2023, 11:24:00 AM

Quote from: a298b112 on December 01, 2023, 10:45:21 AM

Well, after recent news about MicroStrategy's purchases of BTC, I wonder how come Saylor and his company can buy so many BTC, while other companies/funds are (kind of) waiting for ETFs to be approved?

Saylor has always been an HODLER and advocate of Bitcoin and this is a proof for his trust in bitcoin, I believe him analysing his investment plan made him make such decisions of getting more bitcoin now while some maybe waiting for halving and ETF approval. Remember buying or investing in bitcoin doesn't have a fixed price, it all matters how long the investor is planning on HODLING.

It shows the level of trust that an individual can have for what he believes in, if Saylor, was able to go to the extreme length of collecting loan and using bitcoin, as a collateral to collect the loan to buy bitcoin, then it shows that his faith for the coin is at a peak level. Why wait for ETF when you already know that the time is now to accumulate and hold as many btc as you can, if the ETF goes through, competition will be much, so if a believer has the capital, there's no need to wait for that. Moves like this will pave way for more adoption of bitcoin, because it'll help to convince more people about the profitability of bitcoin.

Publictalk792

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You are thinking how MicroStrategy is able to buy a lot of Bitcoin compared to other companies and funds waiting for ETF approvals. MicroStrategy CEO(Michael Saylor) believes in Bitcoin. And I don't think so he is waiting for the ETF approval he just believe in Bitcoin he thinks that Bitcoin is the currency will dominate the world soon.

And the question about from where this company is getting money? They borrowed money issues notes that will be converted into shares and they sell shares to raise funds to buy Bitcoin. They also use their existing cash reserves to invest in Bitcoin. I think that is the source which they mostly use.

And if it is storing Bitcoin so I hope this will compete with the top companies soon because Bitcoin has much potential and this will give a great kick to MicroStrategy which will pump the company on the top level.

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Quote from: a298b112 on December 01, 2023, 10:45:21 AM

Well, after recent news about MicroStrategy's purchases of BTC, I wonder how come Saylor and his company can buy so many BTC, while other companies/funds are (kind of) waiting for ETFs to be approved?

MicroStrategy did not wait for ETFs by doing this they have taken a huge risk but it was worth them because according to the last news I have heard they have made over 1$ billion on their overall holdings of BTC, they have accumulated over a long period of time. This is the power of doing DCA but we can also do that with little money and by covering the seed profit we can take entry again. But coming back to your question.

They don't apply for ETFs because it is their choice even the companies you are talking about can buy BTC directly and they are buying it but by doing that they will face huge risks of volatility and legal scrutiny but with ETFs, they will have the support of local governments and they might not face any legal cases.

Quote from: a298b112 on December 01, 2023, 10:45:21 AM

And another question is, MicroStrategy seems to be not that big company, comparing Apple, MS and Google. Where they get money to buy BTCs? I mean are they getting loan, or doing some kind of fundraising?

I would say they were smart and must have financial plans and talking about strategic ways to earn money they made money in 2020 by debt financing, where the revenues were used to buy or I should say accumulate BTC and over a very long period of time they are collecting their revenues and investing some of its money into BTC from a long period of time and as I said before it has made them over a billion dollar.

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Funds aren't necessarily waiting for an ETF approval, because if a certain fund wants to buy BTC, they can do so already through platforms like Coinbase Custody or whatever institutional platform.

As for MicroStrategy — they have revenue through some of their SaaS products, they do loans, and they do share distributions.

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Quote from: a298b112 on December 01, 2023, 10:45:21 AM

And another question is, MicroStrategy seems to be not that big company, comparing Apple, MS and Google. Where they get money to buy BTCs? I mean are they getting loan, or doing some kind of fundraising?

Even its smalls or not comparable to those. The guy believed in bitcoin and willing to risk their company fund for more leverage on bitcoin. Im not sure how the process of purchasing since they are legit company and probably via OTC or some brokers. Surely they dont use a normal buying bitcoin on the exchange for acquisition considering the bulk of bitcoin value they are buying.

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Quote from: a298b112 on December 01, 2023, 10:45:21 AM

Well, after recent news about MicroStrategy's purchases of BTC, I wonder how come Saylor and his company can buy so many BTC, while other companies/funds are (kind of) waiting for ETFs to be approved?

Saylor has always been an HODLER and advocate of Bitcoin and this is a proof for his trust in bitcoin, I believe him analysing his investment plan made him make such decisions of getting more bitcoin now while some maybe waiting for halving and ETF approval. Remember buying or investing in bitcoin doesn't have a fixed price, it all matters how long the investor is planning on HODLING.

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Quote from: a298b112 on December 01, 2023, 10:45:21 AM

Well, after recent news about MicroStrategy's purchases of BTC, I wonder how come Saylor and his company can buy so many BTC, while other companies/funds are (kind of) waiting for ETFs to be approved?

This courageous move by Saylor and his company demonstrates their confidence in bitcoin. If they waited for bitcoin ETF approval, they would be considered short-term investors, which most of these big companies are not. They have all been investing for a long time because they have confidence in the bitcoin market. If approved, Bitcoin ETF is just another way to manipulate the market even more, and I am sure the SEC is aware of this and will not allow anything that will cause major market manipulation due to hype or approval of it.

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And another question is, MicroStrategy seems to be not that big company, comparing Apple, MS and Google. Where they get money to buy BTCs? I mean are they getting loan, or doing some kind of fundraising?

The micro strategy is attempting to play smart here, and this is the best option for them. Saylor compared bitcoin investment to an early investment in Facebook's social network. This is just one example of the company's conviction in bitcoin's long-term growth. They took some loans to purchase some of this bitcoin, and they have no regrets because of their optimism in the digital asset.

Zaguru12

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Firstly there is a dedicated thread by Fillippone on Microstrategy bitcoin buys and other you can visit the link to engage there.

Quote from: a298b112 on December 01, 2023, 10:45:21 AM

Well, after recent news about MicroStrategy's purchases of BTC, I wonder how come Saylor and his company can buy so many BTC, while other companies/funds are (kind of) waiting for ETFs to be approved?

The reason is because Microstrategy is not looking at short term pumps or hypes like the ETF they have been a long term bitcoin holders and have recently shown that they will keep stacking more. Although they do take profits at some points. Also this recent buy might have been done a bit earlier than when the report was made by Saylor.

Quote from: a298b112 on December 01, 2023, 10:45:21 AM

And another question is, MicroStrategy seems to be not that big company, comparing Apple, MS and Google. Where they get money to buy BTCs? I mean are they getting loan, or doing some kind of fundraising?

Some of their bitcoin holdings have been bought by loans, a clear example was when they took a loan from Silvergate worth $205 Million last year with bitcoin as collateral to accumulate more bitcoin. It has also been reported that this loan has been repaid back. So this means that some holdings will be from the companies funds and most from collateral based loans

a298b112

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Well, after recent news about MicroStrategy's purchases of BTC, I wonder how come Saylor and his company can buy so many BTC, while other companies/funds are (kind of) waiting for ETFs to be approved?

And another question is, MicroStrategy seems to be not that big company, comparing Apple, MS and Google. Where they get money to buy BTCs? I mean are they getting loan, or doing some kind of fundraising?

Topic: How can Microstrategy buy so many BTC, while other funds waiting for ETF? (Read 131 times)